A Series on Sustainable Planet, People + Prosperity

 

A few weeks ago I compared Hong Kong’s and Singapore’s (SG’s) drinking water sustainability efforts. Now I’ll begin to do the same for transportation sustainability. This post looks at one way HK and SG try to reduce vehicle traffic volume. In future posts I’ll examine measures that the different locations have (or haven’t) carried out to try to relieve traffic congestion, reduce individual vehicle tailpipe emissions, encourage public transportation use, and support bicycle and pedestrian travel.

Efforts to reduce traffic volume begin with reducing the population of personal automobiles. Both locations attempt to do this by making it very expensive to own and operate a car, primarily by levying high initial registration fees as well as having high fuel taxes/prices. Additionally Singapore imposes high tariffs on cars and its Certificate of Entitlement (COE) program places an absolute cap on the number of vehicles allowed in the nation and limits vehicle population growth to 1/2% per year.

If this US$100,000+ Tesla Roadster had an internal combustion engine its HK First Registration Tax could have been more than US$95,000. But the tax is waived for all-electric vehicles.

HK’s First Registration Tax (FRT) marginal tax rates start at 40% of a car’s market value and can be as high as 115%. For a $50,000 (HK$388,000) car the FRT is $33,570 (HK$260,500). Singapore’s Additional Registration Fee (ARF) rates start at 100% and can be as high as 180% of car value. For a US$50,000 (S$64,500) car the ARF is US$68,295 (S$88,100). U.S. registration fees are considerably less. HK and SG are near the top of world gasoline prices while the U.S. is near the bottom. Current regular unleaded gasoline prices are around $7.91/gallon (HK$16.19/liter) for Hong Kong, $6.09/gallon (S$2.08/liter) for Singapore, and $3.18 /gallon in the U.S.

Hong Kong does not have an import duty on vehicles. Singapore charges an import excise duty that is 20% of a car’s market value. Twice a month Singapore’s COE program makes a limited number of new car purchase rights certificates available by on-line open bid. In the first November 2014 round, successful bidders paid a Quota Price of $50,310 (S$64,900) for the right to purchase a new car with an engine size of 1600CC or less. The Quota Price for cars having larger engines was $54,952 (S$70,890).

Data source: The World Bank

 

Economic theory predicts that higher costs result in lower demand and in general that seems to be born out by the facts with respect to the motor vehicle population rates and transportation fuel use (gasoline + diesel) of HK, Singapore, and the U.S., if one takes into account that Singapore’s per capita Gross National Income is roughly 40% higher than those of HK and the U.S. Thus Singapore residents can more easily afford more expensive cars and gasoline. In 2011 the number of motor vehicles per 1,000 people was 786 in U.S., 151 in Singapore, and 80 in Hong Kong . The amount of fuel used for transportation per person per year in 2011 measured in kg of oil equivalent (a standardized energy unit) was 1,510 in the U.S, 497 in Singapore, and 244 in Hong Kong.

For the long term, it’s hard to predict if one location’s efforts to limit vehicle population and thus traffic volume will work better than the other’s. Singapore’s automobile fees and duties are higher than HK’s and its COE program is certainly a more explicit control measure. But at least for now, HK’s lower per capita transportation fuel usage and vehicle population rates seem to give it the edge in sustainability. However vehicle population is only one piece of the sustainable transportation puzzle. In my next blog I’ll try to fill in more of the overall picture.

 

 

Dante Archangeli moved to Hong Kong from Tucson, Arizona, where he focused on sustainable construction and development. He is an MIT and USC educated project manager, entrepreneur, and builder.

All photos and chart by Dante Archangeli.

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3 Responses

  1. Martin Turner

    A key tool to control the motor traffic ‘population’ is a fee to enter the urban downtown/CBD (‘congestion charge’), pioneered in Singapore and successfully applied in London and elsewhere.

    This has long been proposed for Hong Kong, where it would clearly be very effective, as much of the private vehicle usage is discretionary, and many commercial vehicles could easily reschedule to avoid peak hours. But the HK government is resistant, apparently in thrall to business interests.

    A further simple solution is to re-price the three cross-harbour tunnels, to redistribute traffic from the (cheaper, heavily used) central one to the other two, which have spare capacity. Recently, a plan that moves a little in this direction was introduced, but not to be implemented for several more years.

    Hong Kong has a high-capacity public transport system, and urban areas whose compactness makes them well suited to walking and cycling. Its traffic problems are quite solvable, if the government would show some policy flexibility and seek to serve the needs of ordinary people rather than the commercial lobby.

  2. Paul Zimmerman

    Our older urban districts which have a limited capacity to absorb traffic. The resulting congestion in these districts leads to the queuing on the main corridors of traffic trying to enter. To address this we need reduce parking spaces within districts while offering conveniently connected parking just outside (Star Ferry car park and Rumsey Street car park are examples). Next we need to charge for the use of roads within these districts. New technology should make this possible at little cost. The fees will have to increase when GDP and car ownership go up, as well as when travel times are shortened with new cross border links and new highways in Hong Kong.

    The government has and continues to consider traditional electronic road pricing with gates once the central bypass is open to promote the use of alternate routes. This is of little use in addressing HK’s specific congestion problems. Equally, changing fares at our existing gates – the tunnel fares – may change queue lengths at tunnels to a limited extent, but it does not solve the traffic congestion problems.

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